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Let the Re-test Begin



November 04, 2008 – Comments (3) | RELATED TICKERS: DBC , RJA , SDS

Every November following a 5% down October has been a down month since WWII.  I wouldn't exepct this to be any different given the weak fundamentals in the economy.  Friday's numbers could be brutal, that could be the going into the weekend slap that leads to a big sell-off next week.  Then again, maybe not.  But between today and tomorrow, I'm writing covered calls, selling a few things and where it makes sense selling a few puts of things I'd love to own 30% lower from today's prices.

Folks, earnings are going to be very bad next year and threaten to take until 2012 to rebound fully.  Don't be silly and stick 80% of your money into the stock markets again.  With inflation highly likely by late next year on the increased money supply, some commodities- Ag in particular- are a great idea.  Some closed end funds with great "junk" bond managers trading at a discount still make sense as well. 

3 Comments – Post Your Own

#1) On November 04, 2008 at 5:46 PM, TheBubbleBoy (< 20) wrote:

Another bitter rant from a greedy fool who waited too long and got priced out of the market.

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#2) On November 04, 2008 at 7:16 PM, DarkToast (32.23) wrote:

Bubbleboy, it is easy enough to check if this "Every November following a 5% down October has been a down month since WWII." is true. If it is, then Kirkydu has a good point.

That said, the way to make money in a bear market is the old in-and-out. No reason not to get back into the market when stocks that you like are at 52 week lows and the technical indicators show a strong probability of going up. Just be ready to jump right back out and take your profits off of the table.


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#3) On November 10, 2008 at 12:42 AM, kirkydu (90.76) wrote:

not sure where the bitter rant comes from.  Take a look at my rating and other posts.  I've been on this pretty much from the get go and in real life am around even.  Simple fact is that a lot of assets have to deflate in the very short term.  After that we'll get stagflation in developed markets for an extended period due to the monetary expansion but consumers still having too much debt to income.  Emerging markets will rebound due to building and middle classes starting to consume once financial markets shake out for them sometime next year.  That's where to put money.  Commodities and businesses that benefit from a rebound in emerging markets.  The developed world in aggregate might be flat for a long time- especially western Europe.

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